A memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity, and if it was the regular practice of that business activity to make the memorandum, report, record or data compilation, all as shown by the testimony of the custodian or other qualified witness, or by certification that complies with Rule 902(11), Rule 902(12), or a statute permitting certification, unless the source of information or the method or circumstances of preparation indicate lack of trustworthiness.

So, who constitutes a qualified witness? And does that witness need personal knowledge regarding the creation of the document offered, or personal participation in its creation, or knowledge of who actually recorded the information? In its recent opinion in Crash Test Dummy Movie, LLC v. Mattel, Inc., 2010 WL 1508203 (Fed. Cir. 2010), the Federal Circuit suggested that the answer to this latter question is "no." I disagree.

Mattel's predecessor-in-interest, Tyco Industries, Inc...., first produced a line of toys under the CRASH DUMMIES marks in 1991. In 1993, Tyco obtained federal trademark registrations for the CRASH DUMMIES marks...Tyco sold toys under the CRASH DUMMIES marks through at least 1994....

On July 14, 1995, CDM entered into an option agreement with Tyco to produce a motion picture based on Tyco's line of toys sold under the CRASH DUMMIES marks. The option agreement expired on July 14, 1996. Although CDM attempted to renegotiate a license later that year, Tyco declined to enter into another option agreement with CDM....

In the mid-1990's, Tyco experienced financial difficulties and began negotiating an acquisition with Mattel. On February 12, 1997, Tyco assigned its trademark portfolio, including the CRASH DUMMIES marks, to Mattel. Mattel officially purchased Tyco on December 31, 1997. Mattel later recorded Tyco's assignment with the United States Patent Trademark Office (“USPTO”) on February 13, 1998....

From 2000 to 2003, Mattel worked on developing a new line of toys under the CRASH DUMMIES marks. In 2000, Mattel began brainstorming ideas for CRASH DUMMIES toys. Mattel researched, developed, and tested its new toys as early as 2001, and obtained concept approval by 2002. Mattel began manufacturing CRASH DUMMIES toys in October 2003, and ultimately reintroduced them into the market in December 2003. While Mattel was developing new toys, the USPTO cancelled the registrations for the CRASH DUMMIES marks on December 29, 2000, because Mattel did not file a section 8 declaration of use and/or excusable nonuse for the marks.

On March 31, 2003, CDM filed an intent-to-use application for the mark CRASH DUMMIES for games and playthings. Mattel opposed CDM's application, claiming priority to Tyco's prior registration and use of the CRASH DUMMIES marks.

In proceedings connected to the lawsuit conducted by the Trademark Trial and Appeal Board, Mattel introduced into evidence product development documents pursuant to Federal Rule of Evidence 803(6). At the time, CDM actually stipulated that the documents were business records of Mattel and Tyco. Thereafter, however, CDM claimed that Mattel failed to lay a proper foundation for admission of the documents, and the United States Court of Appeals for the Federal Circuit found this argument to be without merit based upon CDM's stipulation.

The court then went on to note that even if this were not the case, Mattel properly introduced the documents through a qualified witness, Peter Franks, Mattel's marketing manager. According to the court,

Although Frank began working at Mattel in August 2003 and thus may not have first-hand knowledge of Mattel's product development, he testified that he had learned about the history of the CRASH DUMMIES product line upon joining Mattel's INCREDIBLE CRASH DUMMIES team. He also acknowledged that he had reviewed Tyco and Mattel's documents and spoke with employees who had been with Tyco and Mattel during the relevant time period. The Board reasonably found that Frank was sufficiently competent and trustworthy to testify on the issues before him.

In other words, the Federal Circuit seems to agree with courts such as the Eighth Circuit, which has found that

As long as the other requirements of the business records exception are met, a custodian or "other qualified witness" need not have personal knowledge regarding the creation of the document offered, or personally participate in its creation, or even know who actually recorded the information. Resolution Trust Corp. v. Eason, 17 F.3d 1126, 1132 (8th Cir. 1994).

Conversely, other courts require a qualified witness to have such personal knowledge. See, e.g., United States v. Baker, 538 F.3d 324, 332 (5th Cir. 2008). I don't see how the former courts can justify their conclusions. In effect, these courts are reading the qualified witness requirement out of the rule, essentially holding that a qualified witness is not needed if all of the other elements of the Rule are satisfied.

Comments

While I agree that the court's discussion of the 803(6) issue was dicta, I'm not so confident they've written the 'qualified witness' requirement out of the rule. The 'qualified witness' in Crash Dummies was (1) an employee of the business entity whose records were at issue; (2) though not an employee and not present at the creation of the records had familiarized himself with the records and the circumstances surrounding their creation by talking with others in the business who did have personal knowledge. Even though this portion of the foundation rests upon the out of court statements of other employees of the business those individuals still have a business duty to report accurately and, furthermore, under rule 104(a) the court may consider hearsay in determining admissiblity. Though not addressed with the detail and careful analysis that we would expect if the issue had actually been necessary to the decision, I don't think we can say anything other than the Federal Circuit has generally applied the same rule that virtually all the other Circuits have applied in this area. The 5th Circuit's Baker decision is clearly correct because the government offered the business records of NEMEC and tried to use a local police officer as the 'qualified witness.' The witness was not employeed by the entity whose records were at issue. While the 'qualified witness' requirement of 803(6) is not intended to be onerous, you do need someone who works for the organization that produced the records you are claiming were created in the course of their regularly conducted activity. Other 5th Cir. opinions are consistent with this approach. See, e.g., U.S. v. Box, 50 F.3d 345 (5th Cir. 1995). As always, your blog is great and I look forward to each post.

Posted by: W.A. Woodruff | Apr 23, 2010 5:31:51 AM

Thanks for the comment. Upon reviewing the opinion, I think that you are right that my post was a bit of an overreaction.